The Financial Accounting Standards Board (FASB) issued a proposed Accounting Standards Update (ASU) and Invitation to Comment (ITC) on the recognition and measurement of deferred revenue in business combinations.
The proposed ASU intends to address diversity in views about circumstances in which an entity should recognize a contract liability from a contract with a customer (within the scope of Topic 606) that is acquired in a business combination. The ITC is issued concurrently to solicit feedback about measurement and other topics related to revenue contracts with customers under Topic 805, Business Combinations.
Stakeholders are encouraged to review and provide input on the proposed ASU and ITC by April 30, 2019.